📘 Recent Current Affairs – February 2026
Page 3 – Economy
🔹 Multiple Choice Questions (MCQs)
Q1. The emphasis on capital expenditure (Capex) in the Union Budget primarily aims to:
A) Increase short-term subsidies
B) Boost long-term economic growth
C) Reduce tax compliance
D) Expand revenue deficit
Answer: B
Explanation: Capital expenditure on infrastructure, logistics, railways, and digital connectivity enhances productivity, crowd-in private investment, and generates long-term growth.
A) Increase short-term subsidies
B) Boost long-term economic growth
C) Reduce tax compliance
D) Expand revenue deficit
Answer: B
Explanation: Capital expenditure on infrastructure, logistics, railways, and digital connectivity enhances productivity, crowd-in private investment, and generates long-term growth.
Q2. India’s Production Linked Incentive (PLI) scheme is designed to:
1. Promote domestic manufacturing
2. Reduce import dependence
3. Increase service sector exports only
A) 1 only
B) 1 and 2 only
C) 2 and 3 only
D) 1, 2 and 3
Answer: B
Explanation: The PLI scheme incentivizes large-scale manufacturing across sectors like electronics, pharma, and solar modules to strengthen industrial capacity and reduce imports.
1. Promote domestic manufacturing
2. Reduce import dependence
3. Increase service sector exports only
A) 1 only
B) 1 and 2 only
C) 2 and 3 only
D) 1, 2 and 3
Answer: B
Explanation: The PLI scheme incentivizes large-scale manufacturing across sectors like electronics, pharma, and solar modules to strengthen industrial capacity and reduce imports.
Q3. Fiscal consolidation primarily refers to:
A) Increasing government expenditure
B) Reducing fiscal deficit over time
C) Expanding monetary base
D) Increasing external borrowing
Answer: B
Explanation: Fiscal consolidation aims to gradually reduce fiscal deficit and public debt to ensure macroeconomic stability and investor confidence.
A) Increasing government expenditure
B) Reducing fiscal deficit over time
C) Expanding monetary base
D) Increasing external borrowing
Answer: B
Explanation: Fiscal consolidation aims to gradually reduce fiscal deficit and public debt to ensure macroeconomic stability and investor confidence.
Q4. India’s push toward green hydrogen primarily supports:
A) Food subsidy reforms
B) Clean energy transition
C) Banking recapitalization
D) Urban housing expansion
Answer: B
Explanation: Green hydrogen supports decarbonization of heavy industries, energy security, and long-term climate commitments.
A) Food subsidy reforms
B) Clean energy transition
C) Banking recapitalization
D) Urban housing expansion
Answer: B
Explanation: Green hydrogen supports decarbonization of heavy industries, energy security, and long-term climate commitments.
🔹 Analytical Questions
Q5. How does infrastructure-led growth create multiplier effects in the economy?
Explanation: Infrastructure investment generates employment, increases demand for raw materials, boosts logistics efficiency, and attracts private investment—leading to higher GDP growth.
Explanation: Infrastructure investment generates employment, increases demand for raw materials, boosts logistics efficiency, and attracts private investment—leading to higher GDP growth.
Q6. Discuss the importance of fiscal discipline in maintaining macroeconomic stability.
Explanation: Fiscal discipline controls inflationary pressures, stabilizes public debt, enhances credit ratings, and strengthens investor confidence in emerging economies like India.
Explanation: Fiscal discipline controls inflationary pressures, stabilizes public debt, enhances credit ratings, and strengthens investor confidence in emerging economies like India.
📝 15 Marks Mains Model Answer
Q7. “India’s growth strategy reflects a shift toward manufacturing and green transition.” Examine.
Introduction: India’s economic model is evolving from consumption-led growth to investment- and manufacturing-driven expansion.
Body:
Introduction: India’s economic model is evolving from consumption-led growth to investment- and manufacturing-driven expansion.
Body:
- Production Linked Incentive (PLI) schemes
- Semiconductor and electronics manufacturing
- Green hydrogen and renewable expansion
- Infrastructure-led capital expenditure strategy
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Recent Current Affairs Series – Page 3 (Economy)
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